KMU Labor Center v. Garcia, G.R. No. 115381, December 23, 1994

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Ponente: KAPUNAN, J.

A petition for certiorari assailing the constitutionality and validity of certain memoranda, circulars and/or orders of the Department of Transportation and Communications (DOTC) and the Land Transportation Franchising and Regulatory Board (LTFRB) 

Facts:

On June 26, 1990, LTFRB Chairman Fernando issued DOTC Memorandum Order No. 90-395 allowing provincial bus operators to charge passengers within a range of 15% and above and below the LTFRB official rate of one year.

On December 5, 1990, Provincial Bus Operators Association of the Philippines (PBOAP) filed an application for rate increase of eight and a half centavos (P0.085) per kilometer for all types of provincial buses.

On December 6, 1990, PBOAP reduced its proposed fare to of eight and a half centavos (P0.085) per kilometer for all types of provincial buses.

On December 14, 1990, LTFRB granted the fare rate increase.

On March 30, 1992, DOTC Secretary Prado issued Department Order No. 92-587 defining the policy framework on the regulation of transport services. [The control in pricing shall be liberalized to introduce price competition complementary with the quality of service, subject to prior notice and public hearing. Fares shall not be provisionally authorized without public hearing.]

On March 1994, PBOAP availed DOTC deregulation policy in which PBOAP announced a 20% fare increase effective on March 16, 1994

On March 16, 1994, KMU filed a petition before LTFRB opposing the increase in bus fares.

On March 24, 1994, LTFRB dismissed KMU’s petition for lack of merit.

PBOAP, DOTC Secretary Garcia, and LTFRB assert that KMU don’t have the standing to maintain the instant suit and claimed that it is within LTFRB and DOTC’s authority to set fare range schemes and to establish a presumption of public needs in applications for certificates of public convenience.

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1 of 2: Does KMU have locus standi in the case at bar?

Held: Yes.

The court declared that KMU has legal standing since according to the court “the parties have suffered and continue to suffer, members of the KMU have been affected by the fare hikes upon the avail of public transportation every day”

2 of 2: WON the authority given by respondent LTFRB to provincial bus operators to set a fare range of plus or minus fifteen (15%) percent, later increased to plus twenty (20%) and minus twenty-five (-25%) percent, over and above the existing authorized fare without having to file a petition for the purpose, is unconstitutional, invalid and illegal.

Held: Yes.

DOTC Department Order No. 92-587 and LTFRB Memorandum Circular No. 92-009 both violates of the Public Service Act and the Rules of Court. LTFRB Memorandum Circular No. 92-009 is INCONSISTENT with Section 16(c)(iii) of the Public Service Act which requires that before a Certificate of Public Convenience will be issued, the applicant must prove by proper notice and hearing that the operation of the public service proposed will promote public interest in a proper and suitable manner. The provision does not put the burden of proof to the oppositor but the applicant.

PBOAP’s 20% fare increase without the benefit of a petition and a public hearing is null and void and of no force and effect.

LTFRB is authorized under Executive Order 202 to determine, prescribe, approve and periodically review and adjust,reasonable fares, rates and other related charges, relative to the operation of public land transportation services provided by motorized vehicles. They (LTFRB and PSC) are NOT authorized to delegate that power to any common carrier, transport operators and other public services.

Authority given by the LTFRB to provincial bus operators to set a far range is illegal and invalid equivalent to the undue delegation of the legislative body. WHAT HAS BEEN DELEGATED CANNOT BE DELEGATED

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Temporary restraining order issued on June 20, 1994 is made permanent and Department Order No. 92-587 and LTFRB Memorandum Circular No. 92-009 are declared invalid.


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